Hydro Tasmania CEO Ian Brooksbank responds to claims by West Coast Mayor Shane Pitt

Hydro’s boss has expressed ‘sincere disappointment’ over comments a mayor made to his constituents about the organisation. Find out why the Hydro head honcho got so angry.

Reece Power Station tailrace and Pieman River below Reece Dam, part of the Anthony's Pieman hydropower scheme in Western Tasmania. Picture: Hydro Tasmania

“Incorrect and deliberately misleading” is how the head of Hydro Tasmania has described claims that his state government-owned business “didn’t pay a single cent” in royalties to the West Coast Council.

In a letter to residents in the region, West Coast Mayor Shane Pitt said the council had to raise rates on average by 5.4 per cent because Hydro was not paying royalties.

“This year, we are renewing our call to the Tasmanian government to remove Hydro’s current rates exemption for their electricity generating assets in our region,” Mr Pitt said.

“Last year, Hydro made a profit before tax of $168 million but didn’t pay a single cent in rates for their generating assets on the West Coast.

“In our view, this current exemption is unfair, and removing it would create a level playing field for everyone on the West Coast and spread the rates burden much more fairly across the community.”

West Coast Mayor, Shane Pitt visited Parliament House, calling for government help to boost the economy in the region. Picture: Linda Higginson

In response, Hydro Tasmania CEO Ian Brooksbank said in a letter to Mr Pitt that what he told ratepayers was false.

“I wish to express my sincere disappointment in the misleading information you have provided in this letter,” Mr Brooksbank said.

“Your statement that Hydro Tasmania ‘didn’t pay a single cent in rates for their generating assets on the West Coast’ is incorrect and deliberately misleading.”

Mr Brooksbank said Hydro Tasmania makes an annual rates equivalent payment to the state government, which determines how to distribute it among councils.

“For the financial year 2023-24, Hydro Tasmania paid $5.7 million in rates equivalent.

“This is on top of annual dividend payments to the state government, equating to 90 per cent of our profits.

“In the financial year 2022-23, Hydro Tasmania paid a dividend of $105 million to be spent on vital public services and infrastructure for Tasmanians.”

Hydro Tasmania has announced that its CEO, Ian Brooksbank, is departing the high-powered role. Picture: Richard Jupe/supplied

Mr Brooksbank said that Mr Pitt’s comments had affected Hydro staff who worked and lived in the West Coast community.

“It is of genuine concern and disappointment to Hydro Tasmania that ratepayers have been misinformed about this issue and that this is having an impact on our people.

“I would encourage the council to reflect on this to ensure that all further communications are accurate and fact-based.”

The Local Government Act exempts certain entities from paying council rates.

A state government spokesperson told The Mercury that the act includes a specific exemption for land Hydro Tasmania owns and uses for electricity infrastructure assets and operations.

“The rates equivalent is imposed on Hydro Tasmania to address the government’s competitive neutrality obligations and forms part of general revenue to the Government,” the spokesperson said.

“It is not raised on behalf of or distributed to councils.

“Councils benefit from significant state government financial support, which is underpinned by such revenue resources, including the Hydro Dividend.

“The Future of Local Government Review suggests exploring a new framework of rating exemption to ensure councils are able to effectively raise revenue in the best interest of their community, which the government will consider.”

Originally published as Hydro Tasmania CEO Ian Brooksbank responds to claims by West Coast Mayor Shane Pitt